In considering the operations of a mining company,diversifiable risk is best described as:
A)the combination of risk factors that relate to the operations of the mining company.
B)all of those factors that influence all companies in the economy,regardless of industry.
C)all risk factors that tend to influence the mining industry specifically.
D)variations in international commodity prices and the price of gold.

Question

Quizplus · Accepted Answer

Diversifiable risk refers to the risks that are specific to a particular company or industry and cannot be mitigated by diversification alone. In the case of a mining company, diversifiable risk factors may include operating risks such as accidents or equipment failures, political risks such as changes in mining regulations, and financial risks such as changes in interest rates or foreign currency exchange rates. Option A is the best description of diversifiable risk in the context of a mining company, as it specifies that the risk factors are related to the company's operations.

In Considering the Operations of a Mining Company,diversifiable Risk Is